Book contents
- Frontmatter
- Contents
- Preface
- Acknowledgements
- Introduction
- Bibliography
- I The Emerging Role of Econometrics in Economics
- II Early Time-Series Analysis
- III Applied Econometrics and the Identification Problem
- 14 The Elasticity of the Demand for Wheat (Economic Journal, vol. 24, 1914, pp. 212–17)
- 15 Economic Cycles – Their Law and Cause (Macmillan, New York, 1914, pp. 68–80)
- 16 Review of Moore, ‘Economic Cycles’ (Quarterly Journal of Economics, vol. 29, 1915, pp. 631–41 (cut))
- 17 Variation of Supply and Demand Curves: Influences on Prices (Etudes sur la Formation et le Mouvement des Prix, Paris, 1913, pp. 56–62)
- 18 A Moving Equilibrium of Demand and Supply (Quarterly Journal of Economics, vol. 39, 1925, pp. 359–60, 364–71)
- 19 Review of Schultz, ‘Statistical Laws of Demand and Supply’ (Journal of the American Statistical Association, vol. 24, 1929, pp. 207–15)
- 20 Determination and Interpretation of Supply Curves: An Example [Bestimmung und Deutung von Angebotskurven. Ein Beispiel] (Zeitschrift fur Nationalokonomie, vol. 1, 1930, pp. 669–79)
- IV The Evolution of Statistical Thinking in Econometrics
- V Dynamic Models
- VI The Tinbergen Debate
- VII Structure and Simultaneity
- VIII The Probabilistic Revolution
- IX Exogeneity
- Index
17 - Variation of Supply and Demand Curves: Influences on Prices (Etudes sur la Formation et le Mouvement des Prix, Paris, 1913, pp. 56–62)
Published online by Cambridge University Press: 05 June 2012
- Frontmatter
- Contents
- Preface
- Acknowledgements
- Introduction
- Bibliography
- I The Emerging Role of Econometrics in Economics
- II Early Time-Series Analysis
- III Applied Econometrics and the Identification Problem
- 14 The Elasticity of the Demand for Wheat (Economic Journal, vol. 24, 1914, pp. 212–17)
- 15 Economic Cycles – Their Law and Cause (Macmillan, New York, 1914, pp. 68–80)
- 16 Review of Moore, ‘Economic Cycles’ (Quarterly Journal of Economics, vol. 29, 1915, pp. 631–41 (cut))
- 17 Variation of Supply and Demand Curves: Influences on Prices (Etudes sur la Formation et le Mouvement des Prix, Paris, 1913, pp. 56–62)
- 18 A Moving Equilibrium of Demand and Supply (Quarterly Journal of Economics, vol. 39, 1925, pp. 359–60, 364–71)
- 19 Review of Schultz, ‘Statistical Laws of Demand and Supply’ (Journal of the American Statistical Association, vol. 24, 1929, pp. 207–15)
- 20 Determination and Interpretation of Supply Curves: An Example [Bestimmung und Deutung von Angebotskurven. Ein Beispiel] (Zeitschrift fur Nationalokonomie, vol. 1, 1930, pp. 669–79)
- IV The Evolution of Statistical Thinking in Econometrics
- V Dynamic Models
- VI The Tinbergen Debate
- VII Structure and Simultaneity
- VIII The Probabilistic Revolution
- IX Exogeneity
- Index
Summary
16 From what we have just seen [the last section], for a commodity which exchanges freely in a given market, between a group of producers and a group of consumers, if each individual always remains free at each instant to fix his own price, and to increase or decrease his production or consumption, there will finally be convergence, in the market, towards a certain equilibrium price p, for a certain quantity x of goods produced and consumed, p and x being well determined by the curves, say, Γand C. In fact, for a large number of goods, these conditions are roughly realized, and one can accept that the price which establishes itself in reality is nearly the theoretical equilibrium price.
The price depends: on the general economic situation (always supposed constant, in all of this study), on supply and on demand. Now these three elements never stop varying, and, during the course of time, the price follows their variations. In the second part of this study an attempt is made to distinguish by observation between these complicated influences. But we are able to predict here the direction of the variation which will tend to produce a change in each of the two last factors, supply and demand.
We shall say that the supply increases when the indifference curve Γ of the producers passes from Γ2 to Γ'2 (figure 17.1); then to the same indifference price there corresponds a greater quantity produced, and to the same indifference production there corresponds a lower price.
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- The Foundations of Econometric Analysis , pp. 214 - 217Publisher: Cambridge University PressPrint publication year: 1995